It’s a common question: “What if loan interest rates go up while my application is pending?” The answer is, your’s won’t if you are locked in. A “rate lock period” is customary while we’re processing your information. It’s a lender’s promise to hold a certain interest rate and points for a specified amount of time, preventing customers from following the application process from start to finish, only to be surprised with an interest rate higher than they’d applied for. Most rate locks are for 30-60 days.

Another question we’re asked is, “How can I lock into a low interest rate?” Some ways include:

  • Making a larger down payment up front
  • Pay mortgage points over the life of your loan
  • Pay closing costs at your loan’s closing

Please note that while these help you secure a lower interest rate, none of these actions will lock a consumer interest rate in a rising rate environment. 

Most importantly, your interest rate largely depends on your credit score and debt-to-income ratio. If you have good credit, and your income exceeds your debt obligations, you’re more likely to qualify for a lower rate, making your mortgage affordable, and your new home purchase the best investment of a lifetime.